Joycast expects that there is an 5% chance of a loss of $5 million next year. If Joycast conducts new safety policies, the chance of this loss will be 2.5%. The new safety policies will cost $210000 immediately. Assume that the beta of the loss is 0, and the risk-free rate of interest is 4.4%. If Joycast is uninsured, the NPV of implementing the new safety policies is closest to: $329732 $-90268 $29464 $329732

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Production Budget

A budget can be defined as a financial plan designed by an undertaking for a definite period in the future that can contribute towards enhancing the financial success of the business undertaking. It is used to estimate the revenue and expenses. The budget generally takes into account both current and future income and expenses.